BENEFITS DIGEST

Proposed regulations in this morning's Federal Register would write into the regulations what Revenue Ruling 71-447 and the case law behind it established decades ago, that a racially discriminatory private school is not tax exempt. Two things are new. The rule reaches every private school from kindergarten through universities and trade schools, and it treats race-based criteria as discrimination for any purpose, sweeping in diversity-motivated scholarships, donor-restricted funds, and other school-supported programs. Religious admissions criteria survive if they are genuinely religious rather than proxies for ancestry or ethnicity. If finalized, the rule applies to taxable years beginning after May 31, 2027, and comments are due 60 days after publication.

House Education and Workforce Committee Chairman Tim Walberg and Workforce Protections Subcommittee Chairman Ryan Mackenzie have asked the DOL Inspector General to expand its information-sharing audit beyond EBSA, the Wage and Hour Division, and the Office of the Solicitor, the three agencies covered by the IG's June 30 report on the Department's common interest agreements with outside litigants. The August 26 letter asks whether the same informal sharing practices extended to other major DOL enforcement agencies.

Federal regulators will not enforce a rule requiring wellness program rewards to be paid retroactively to the start of the plan year when a participant meets a reasonable alternative standard midyear, as long as the plan pays the reward for the rest of the year. The guidance also confirms that the reasonable alternative standard notice is required only in materials that actually describe the program's terms, not in materials that merely mention it.

IRS/Treasury proposed rule would exclude investment management fees from the plan-related expenses counted in a plan's target normal cost. It would also let sponsors adopt benefit-increasing amendments after the plan year ends, up to the tax return deadline, and still have them reduce that prior year's required contribution, potentially lowering minimum funding obligations for single-employer defined benefit plans.

The IRS proposed the first comprehensive update to the section 430 minimum-funding regulations in years, finally implementing amendments from WRERA, SECURE, and SECURE 2.0. The substantive changes actuaries will care about: investment management expenses are excluded from target normal cost, with a $5,000 threshold mirroring Schedule C itemization; plans adopted after year-end but before the return due date count as adopted on the last day of the year for funding purposes; and benefit-increasing amendments adopted after the valuation date can enter the funding math if they pass a new disproportionality test. Comments are due October 19, and the rules would apply to plan years beginning six months after finalization, with earlier reliance permitted.

The Departments posted a statement confirming that the Fifth Circuit's August 11 en banc decision in Texas Medical Association v. HHS affirmed portions of a district court judgment striking certain regulations and guidance on how the qualifying payment amount is calculated. The Departments say they are reviewing the opinion and anticipate issuing guidance shortly, and that the Federal IDR process remains operational. Until that guidance issues, the QPA methodology the rules prescribed has no replacement.

The Departments released a timeline guide fixing the applicability date for each piece of the June Federal IDR Operations final rules. Two dates matter most for group health plans: the revised batching rules reach disputes whose open negotiation period begins on or after November 1, 2026, and the new remittance advice coding requirements attach to items and services furnished on or after January 1, 2027.

DOL's semiannual regulatory agenda, where EBSA rulemakings get sequenced. The notable thing is how empty it is: the EBSA section carries exactly one entry, the IDR Operations rule, and that rule was already finalized on June 4. In other words, EBSA currently has no pending rulemaking on the public agenda at all.

The federal IDR process moves from single-use web forms to a centralized IDR Gateway late this year, with account registration opening September 15. Practical note for sponsors: a plan using a TPA does not register itself, but should confirm before September 15 that its TPA holds the administrator role.

The Departments' first official acknowledgment of this week's Fifth Circuit decision in the long-running Texas Medical Association litigation over the No Surprises Act's qualifying payment amount methodology, posted to CMS's No Surprises Act notices page. The statement is brief; the ruling it responds to is not. See The First Thing above.

Implementing SECURE 2.0 section 324, the IRS proposes four optional sample forms and standardized procedures for rollovers between employer plans or between a plan and an IRA, aiming to replace today's paper-check-and-fax friction with a predictable process. Use of the forms would be optional and no safe harbor attaches yet; comments are due October 23, 2026.

Treasury and the IRS proposed the framework for employer Trump account contribution programs: a separate written plan, eligibility classes tested under DCAP-style nondiscrimination rules including a 90% sliding-scale safe harbor, written employee notification, and W-2 reporting, with employees able to exclude up to $2,500 per year of employer contributions. The proposal also updates the section 129 DCAP nondiscrimination rules themselves, reflecting the OBBBA's increase of the dependent care exclusion to $7,500. Employers may rely on the proposed rules now; comments are due September 25 and a public hearing is set for October 15.

Private letter ruling addressing the section 4980 transfer of surplus assets from a terminating defined benefit plan to a replacement defined contribution plan. A PLR binds only its recipient.

Rev. Proc. 2026-30 updates the application procedures in Rev. Proc. 2026-4 to streamline requests for letter rulings.

Aon's compliance team breaks down the DOL's newly proposed electronic disclosure safe harbor for group health plans, including who counts as a covered individual, what documents are covered, the required Notice of Internet Availability, and a rule that blocks disclosure by email itself due to PHI concerns. Comments on the proposed rule are due September 21, 2026.

Lockton reviews the DOL's newly proposed rule letting group health plan administrators default to posting disclosures online and notifying participants by email instead of mailing paper copies, with participants still able to request paper or opt out entirely. Comments on the proposed rule are due September 21, 2026.

The Department of Labor recently issued proposed regulations that would implement sweeping revisions to long-standing electronic disclosure safe harbors for health and welfare plans.

On July 23, 2026, the Department of Labor (DOL) issued proposed regulations that would significantly expand the ability of group health plans to furnish required ERISA disclosures electronically (“Proposed Rule”).

a change DOL estimates could lift e-delivery rates from about 68% to 90% and save $402 million a year.

New federal guidance is providing greater certainty around Trump Accounts and expanded their potential application beyond simple savings.

New federal guidance is providing greater certainty around Trump Accounts and expanded their potential application beyond simple savings.

Candidly releas es Trump Accounts guidance; OakPath launches per sonal coach ‘ Aggi ’ for retirees; and Vestmark o pens AI r esearch c enter.

EBSA's 2026 regulatory agenda lists ~20 guidance projects in pre-/proposed/final rule stages, including the fiduciary investment-selection rule (comments analyzed through August, no target date), the

EBSA sent its replacement for the 2022 Biden-era ESG rule to OIRA on June 30, 2026; agenda target release July 2026. Expected to restrict fiduciary consideration of climate/social factors under the

Transfer-tax safe harbor for individual donors who contribute to Trump accounts under IRC §530A. If specified conditions are met, contributions are treated as completed gifts that are not future

Eric Dyson’s review of comments to the DOL on its proposed “Fiduciary Duties in Selecting Designated Investment Alternatives” regulation unearthed a common challenge: How should fiduciaries evaluate

HDHP/§223 OOP measured in-network only (§223(c)(2)(D); a higher out-of-network OOP max does NOT defeat HDHP status; Notice 2004-2 Q&A-4, Notice 2004-50 Q&A-15/19). Deductible=floor, OOP=ceiling. MA

EBSA enforcement-priority shift: 'will not regulate through enforcement'; focus on significant-harm / bad-faith cases; pending and proposed ESOP valuation investigations reviewed against a fairness

Proposed rule requiring PBMs servicing group health plans to disclose direct and indirect compensation to plan fiduciaries, extending the ERISA §408(b)(2) service-provider fee-disclosure framework